Do you want the header image to replace the two lines at the very top or to sit just under those lines? How large is your header image (width and height)?

If you want to effectively hide those blue borders, edit style.css (line 152) and change:

.main a img {
border:2px solid #0085B5;
padding:2px;
}

to

.main a img {
border:2px solid #fff;
padding:2px;
}

Notice I said “hide”. Those borders turn red when you hover (place the mouse) over them. If you take the borders away completely in the CSS above, they’ll re-appear on hover and cause the images to shift slightly – which can be very unsettling.

If you want to remove the borders completely, there are a couple of places throughout style.css where you’ll need to delete references to borders. Turning them to white (#fff) here is just the simplest option.